China won a World Trade Organization (WTO) dispute against Australia concerning anti-dumping tariffs imposed on specific steel products from China.
The ruling was issued on 26 March in Geneva, Switzerland.
China had challenged Australia’s extra duties on railway wheels, wind towers and stainless-steel sinks through WTO in 2021, arguing that Australia’s Anti-Dumping Commission acted inconsistently with WTO anti-dumping agreements. The recent ruling was followed by Australia accepting it and agreeing to work with China to implement the WTO Panel’s ruling.
Issues Raised at WTO
China had requested consultation with Australia regarding Article 17 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping Agreement) and Article 30 of the Agreement on Subsidies and Countervailing Measures (SCM Agreement) on 24 June, 2021, in accordance with rules and procedures for settlement of disputes. The deliberations for this case had been active for about three years. The subject of this dispute is significant to both economies, considering that trade in the aforementioned goods was worth AU$ 62 million.
China had asserted that the Australian Anti-Dumping Commission rejected the exporters’ costs of production when constructing normal values and instead used non-Chinese surrogate costs for steel plate and flanges and that this violated WTO regulations. The ADC had acted inconsistently with some articles of the Anti-Dumping Agreement in the way they compare export and domestic sales.
To Improve Bilateral Relationship?
Australia’s acceptance of the WTO Panel’s ruling was confirmed by Australia’s Trade Minister Don Farrell, who stated on Wednesday that Australia remains committed to a fully functioning WTO dispute settlement system in order for the rights and obligations of all WTO members to be enforced.
Trade tariffs have been a subject of tension between the two economies ever since China imposed sanctions on Australian goods in 2020, the period of historically poor bilateral relations between Beijing and Canberra.
Most tariffs have since been lifted, but some on wine, rock lobsters and slaughterhouses remain.
This episode can be understood as a part of conjoined effort by both the countries to improve their bilateral relationship after a period of tension. Australia recently suspended a complaint filed with the WTO regarding Chinese tariffs on Australian barley, a major target of their sanctions.
Also, they put on hold another WTO dispute concerning China’s sanctions on Australian wine worth about AU$ 1.1 billion in exchange for a Chinese review process aimed at resolving the issue by the end of March.
